Companies may stop allowing their employees to work from home if the job market weakens further over the next year.
Work From Home increased significantly during the pandemic. Opinion on working from home for executives is divided. Some believe it is advantageous, making employees happier, while others say company culture is born in the office.
Melissa Swift, workforce transformation leader at consulting firm Mercer. She said that “There is genuine divergence between organizations”, “You are starting to see companies take sides”.
In the long run, according to Gallup, about 75% of remote-capable workers were hybrid or fully remote in the long run. So we can say that remote jobs are here to stay.
In 2023 work from home will continue, these are the reasons according to experts:
Remote work is crucial for employee retention.
Employee productivity and satisfaction was boosted by remote work, dropout was reduced by 35% according to a joint study by Stanford University, the University of Chicago and the Instituto Tecnológico Autónomo de México.
Caitlin Duffy, research director at consultancy Gartner, said: “Employees experienced new levels of satisfaction working from home, and it’s been hard for companies to justify going back.”
Prithwiraj Choudhury, an associate professor at Harvard Business School, said turnover has become a costly problem as churn rates remain above pre-pandemic levels. Companies cannot afford to lose talent in a labor market that remains tight. That’s especially true for high-performing companies, even if the economy takes a turn for the worse.
He also said that “In any economic environment, the best talents always have outside options”
The recruiting possibility that remote work opens up expands to a larger geographic area and talent pool. This is an incredible advantage for specialized roles where qualified candidates are hard to find.
Inclusion, equity and diversity are supported by offering labor flexibility in a company. People who are excluded in the labor market, such as disabled workers, people of color and working parents, reported great benefits from remote work.
Recession Cost Cuts
A recession, despite what one might think, would not reverse remote work, a recession could accelerate the trend because it can reduce the need for office space and help companies cut costs, according to Choudhury.
This summer several large companies have closed their offices. Lyft Inc. leased about half of its office space in San Francisco, New York, Seattle and Nashville. Yelp Inc. closed its offices in New York, Chicago and Washington with plans to put the savings toward hiring and employee benefits.
Employees allowed to work remotely are willing to accept a pay cut in exchange for greater flexibility and lower commuting costs. The Chiefs keep labor costs low by hiring in states, such as Idaho, Louisiana and Kansas, which have lower costs of living.
Executives risk damaging their reputations if the company takes a radical turn. We can take the recent case of Twitter as an example. New CEO Elon Musk has ended the company’s remote work model. But so many employees opted for severance pay that he had to soften his stance to convince some employees to come back.
Ben Granger, chief workplace psychologist at Qualtrics, said maximizing leverage in this way is not a good long-term strategy.
“Future candidates can see the comments of the employees who left” “They can read the articles. It would be wise for the leaders to think about that.” Granger said.